New Report Suggests Top Crypto Exchanges Fake Their Volume
A report has emerged suggesting that many of the top 100 crypto exchanges have faked their transaction volumes by up to ten times the correct amount. This was reported by Bloomberg on March 19, 2019.
Not Adding Up
Analysts, crypto users, and law enforcement are seemingly always on the lookout for any signs of manipulation or fraudulent activities. This happened in the case of Tether (USDT) a startup that has been continuously accused of helping manipulate the price of bitcoin.
Now, it would seem that the problem runs far deeper than a few exchanges inflating their numbers as it was reported on March 19, 2019, that a majority of the crypto trading volume reported around the world is fraudulent.
According to the results of the research, about 75 percent of the exchanges have reported transaction figures that are double what they are supposed to be. In total, the report claims that about 90 percent of the exchanges are under suspicion for faking transaction volume. It is to be noted, however, that the metrics do not consider application programming interface or usage of mobile apps.
The expected trading volume was determined by considering the weighted average trading volume of each visitor from the United States on exchanges such as Binance, Coinbase Pro, Gemini, Poloniex and Kraken which was about $591. This was applied to other exchanges, and it was then found that some reported figures up to ten times the expected result. Two exchanges, BitMax, and Lbank, in particular, reported very high figures.
Binance, on the other hand, reported figures that were in line with the expected outcome.
There has always been talk of exchanges and firms manipulating their figures in the crypto industry. This report, however, shows that it is much more rampant than previously thought and is even prevalent among larger firms and exchanges.